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Proposed Rule from EPA and U.S. Army Corps of Engineers Seeks To Expand Federal Jurisdiction of Water

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Introduction: A Revised Definition of “Waters of the United States”

After years of study, litigation, controversy – and mayhem – the Environmental Protection Agency (“EPA”) and Army Corps of Engineers (“Corps”), on April 21, 2014, jointly published, for comment, a new definition of “waters of the United States” under the Clean Water Act (“CWA”). 79 Fed. Reg. 22188-22275. According to the Preamble: “[t]he purposes of the proposed rule are to ensure protection of our nation’s aquatic resources and make the process of identifying waters of the United States” less complicated and more efficient.” FR at 22188. The agencies further promise that, “[t]his rule will result in more effective and efficient CWA permit evaluations and increased certainty and less litigation.” FR at 22190. Under the proposed rule, (1) all tributaries, including those that are either perennial, ephemeral, or intermittent; and (2) all adjacent waters, including adjacent wetlands, would be categorically subject to federal oversight with no additional analysis required. Additionally, so-called “other waters” would be included on a case-by-case basis. The key here is the term “significant nexus,” language first used by Justice Anthony Kennedy in his concurring opinion to Rapanos v. United States. 547 U.S. 715 (2006). If any of those waters have a significant nexus to those navigable waters already under the jurisdiction of the CWA, they are now included.

The purpose of this rule is to settle 40 years of debate as to what constitutes waters of the United States. But in fact, the new policy presents an aggressive direction for EPA and the Corps, threatening to place broad areas of wetlands and streams – including intermittent streams – under federal scrutiny. In doing so, the proposed rule would have a major impact on individuals and businesses that develop, use, or change land, including oil and gas companies, pipeline operators, developers, golf courses and many others.

The rule will be subject to a 91-day public comment period. Comments are due no later than July 21, 2014.

Moving from a traditional definition of “navigable waters” to waters connected by a “significant nexus”

Early environmental laws were structured to promote and improve interstate navigation. Tests such as the simple “saw log test” were used to determine if certain water was navigable; i.e., if a “saw log” could float on it, that water was navigable. Early environmental laws kept these traditional notions of “navigable waters” as providing authority, therefore limiting the reach under these statutes. The CWA continues that this establishes that jurisdiction also applies to navigable waters. However, it went further than its predecessors by defining navigable water itself to include both “waters of the United States” and what are known as the “territorial seas,” i.e., the waters located within three miles of the United States coastline. 33 U.S.C. 1362 (7-8). No further clarification was provided, so there are 40 years of court cases and federal rulemakings trying to do what Congress either could not or would not do. As a result, there is a patchwork definition of “waters of the United States” that focuses on waters of interstate and navigable nature, but also includes some lesser bodies of water that are connected to these types of waters.

As the definition goes further away from the term "navigable," things get murky (no pun intended). And with every push to go even further, the matter gets kicked to the courts, to decide the intent of Congress. In Rapanos, the Supreme Court had to decide whether the CWA applied to non-navigable tributaries of traditional navigable waters. The Court decided it did – but was split as how to define the connection between them. Justice Kennedy ruled in a concurring opinion that any waters that share a "significant nexus" to navigable waters can be regulated under the CWA. This was not a majority opinion, so the matter was not settled. With the split as to how far to go, the EPA and the Corps – perhaps not surprisingly – took Kennedy’s “significant nexus” language and used it to help formulate its rule.

Reach of the proposed rule: Tributaries, Adjacent Waters and Other Waters, and beyond

Currently, the CWA applies to (1) waters used in interstate or foreign commerce; (2) interstate waters; (3) the territorial seas; (4) and any “impoundments” of these waters (e.g., reservoirs or other water basins created when water is dammed). The proposed rule does not change this, but adds three new bodies of water:

All tributaries of the waters identified above

All waters, including wetlands, adjacent either to the newly defined tributaries or to any of the other waters identified above

So-called “other waters,” including wetlands. Section 2 (a)(5-7).

Tributaries and adjacent waters would be categorically included under the CWA’s jurisdiction once the rule becomes final. Other waters would be included only after being reviewed on a case-by-case basis. But for all of these waters, there must be a significant nexus with another water already covered by the CWA, defined as when the water “significantly affects the chemical, physical, or biological integrity” of one of these waters. Section 2(c)(7).

The proposed rule can be seen as an attempt by EPA to align itself with Justice Kennedy’s concurring opinion as the middle ground in the question of how far the CWA’s reach should go. For example, the Preamble states: “[b]ecause Justice Kennedy identified ‘significant nexus’ as the touchstone for CWA jurisdiction, the agencies determined that it is reasonable and appropriate to apply the ‘significant nexus’ standard for CWA jurisdiction that Justice Kennedy’s opinion applied to adjacent wetlands to other categories of water bodies as well (such as to tributaries of traditional navigable waters or interstate waters, and to “other waters”) to determine whether they are subject to CWA jurisdiction, either by rule or on a case-by-case basis.” FR at 22192.

However, it clear that instead of just settling the decision of jurisdictional reach of the CWA, the significant nexus connection expands it even further. A number of questions are raised, including:

What does and does not constitute a “tributary”? Tributary is a term used in other rulemakings by the EPA, but for the first time it receives a definition here. The rule defines it as “a water physically characterized by the presence of a bed and banks and ordinary high water mark” that “contributes flow” to another water. Section 2(c)(5). That would include naturally flowing rivers or streams that empty into lakes or oceans. But the proposed rule goes further than rivers and streams. Tributaries would also include wetlands, lakes and ponds “even if they lack a bed and banks or ordinary high water mark.” Further, a tributary can be “man-altered” or “man-made,” raising the prospect of man-made ditches being included. Finally, the flow can be either direct or “through another water.” Id. So it can be a tributary of another tributary and still be covered under definitions.

The Preamble uses the word “convey” when discussing the characteristics of tributaries: waters are tributaries when they “convey water to traditionally navigable waters, interstate waters, and territorial seas.” FR at 22202. But if most bodies of water eventually convey water somewhere else, would not most of them meet the definition of tributary under the proposed rule?

What about ditches, artificial lakes, or ponds? Related to the question of what constitutes a tributary, the definition raises the possibility that tributaries could be expanded to include man-made bodies of water with artificial features, such as ditches used for drainage purposes, or artificial lakes or ponds. The rule specifically excludes “ditches that are excavated wholly in uplands, and have less than perennial flow.” Section 2(b)(3). But no definition is made of “perennial flow,” meaning it could be interpreted, at the EPA’s discretion, to include a ditch with water that flows only one day a year. Nor is there any mention of ditches that flow downlands; for example, a ditch that drains water and also artificial inputs (such as pesticides) off croplands or turf grass. Further, while artificial lakes or ponds are also excluded, they are only excluded if they are excavated from “dry land” and used exclusively for “stock watering, irrigation, settling basins or rice growing.” Section (2)(b)(5)(iii). So if an artificial lake or pond is connected to a larger water table (as most are) and does not have one of the uses specified, it is included under the proposed rule.

How close is adjacent? Under the proposed rule, “adjacent” is defined to mean waters “bordering, contiguous or neighboring” other jurisdictional waters covered by the CWA. Section 2(c)(1). Neighboring is further defined as including “waters located within the riparian area or floodplain of [all other waters], or waters within a shallow subsurface hydrologic connection or confined surface hydrologic connection.” Section 2(c)(2). These two definitions raise the possibility that two waters can be separated by a large amount of land and still be considered “adjacent.” This is supported by language in the Preamble, which states that “in showing chemical, physical or biological connection between adjacent waters and other jurisdictional waters, adjacent waters, including wetlands, may be separated by land or other features not regulated under the CWA” (emphasis added). FR at 22210.

Will the definition of “other waters” be interpreted to include everything else?

Under the proposed Rule, other types of waters could be determined to be jurisdictional under the CWA through a case-specific analysis showing that the water, alone or in combination with similarly situated waters (including wetlands), have a significant nexus to traditional navigable waters, interstate waters or the territorial seas. Section 2(a)(7). The words “in combination” raise the prospect that an aggregated approach could be used to categorize numerous bodies of water as “other waters.” This could lead to sweeping interpretations by EPA personnel impacting many bodies of water and many acres of land. The Preamble in fact requests comment on whether such a group approach would be effective, including the “ecoregion” approach where a “contiguous area of land with relatively homogenous soils, vegetation and landform (e.g., plain, mountain, valley, etc.) would be regulated so long as it contained waters that “generally provide similar functions to the downstream traditional navigable waters, interstate waters or the territorial seas.” FR at 22213.

Conclusion

It is not easy to overestimate the scope and reach of this proposed rule. While it is purportedly aimed at clarifying which wetlands and streams qualify for protection under the CWA, it can also be seen as impacting most bodies of water in the country and the lands around them as well. Because of this, further litigation, it seems, is assured, as well as direct congressional action to reverse or change the rule by authorizing legislation or indirect congressional action to prohibit the EPA or Corps from spending any funds to implement it.

Additionally, many comments on the proposed rule have already been submitted and many more are expected. Further revisions are anticipated to occur, although to preserve rights to future challenge and for other reasons, adding a comment now is an important strategy to consider.